Google announced it’s anticipated browser, Google Chome, yesterday, and then quickly pulled it offline. Today they finally released it, and we were all anxious to try it out. Our developers of course, were anxious to see how it rendered LEAP. (screenshot attached below)

We were all very impressed with how fast Chrome rendered LEAP. Windows inside of LEAP can be manipulated quite a bit faster, and this appears to be exactly what Google was trying to accomplish (well, one of the items). The key takeaway from the launch is that Google has engineered Chrome for how people use the Web in 2008, which is to run applications like Google Docs, Gmail, and LEAP.

To accomplish this, Google built a new javascript engined dubbed V8 that is specifically designed for better performance of these applications, which is consistent with Googles take (and many others) on how software will be managed through browsers.

I’m personally impressed with Chrome. I’m an OSX guy, so I was a little discouraged to see that Google only released the Windows version, though there is plenty of reasoning behind that. Priorities..

Hardware is constantly outdated which, normally, presents a big problem for dedicated hosting clients. You get a server today and in 6 months your provider will naturally be offering a replacement of your server for new clients- with bigger and better stuff.

While we can’t entirely solving that problem, we decided recently to begin only offering a minimum of 2GB of RAM on new servers. To show our commitment to our very loyal clients, we are providing a free RAM upgrade to bring each and every client to 2GB of RAM.

As far as we know, this is the first time a hosting provider has gone back and mass upgraded it’s clientèle on this level. Here’s the bottom-line impact and the reason providers don’t normally do this:

1,200+ servers potentially impacted (We feel in the area of 50% of these effected).
We’re also going to be reducing approximately 20% of our customers bills that pay for 2GB of RAM.
In all, over the course of a year, hardware expense and loss of revenue: Well over $100,000.

Sounds meek, right? To an accountant it might not be the best move, but our business is experiencing exponential growth. That’s largely based on our very loyal clients and reduced advertising costs because so many of you are talking positively about our services on various forums and websites. We’re showing our appreciation for your business and we would love to hear your feedback to this giveaway, or feedback on our services!

With the announcement of LEAP, we’ve had some extremely exciting times at the company. That’s going to get better with more announcements next week as we continue to pass up the competition in terms of new features and services all aimed at giving you more control over your infrastructure and done at affordable prices. (or in this case, an upgrade for free!)

Overall, we’re happy to be in the position to do it, and we hope that you appreciate the efforts and service that you receive from SingleHop.

To take advantage as an existing client, go here: http://www.singlehop.com/servers/free_ram_upgrade_offer.php

This isn’t exclusively for dedicated servers, the web hosting industry. In fact, the idea of giving something to get something back has gone on for a lot longer than anyone reading this has been around, but it’s just as effective today.

What got me going on this is a book that Dan Ushman recommended to me- The Psychology of Influence, which is a good read. The author writes the book based on what’s influenced him toward making a decision in the past. One point that I really took note of was the idea that when you give something, the person receiving will have a sense of loyalty to return something to you.

If you think about it, we run into real world examples all of the time. You’re at the grocery store, you take a sample and the smiling person says “How do you like it?” She doesn’t tell you how much better it is than everything is, she doesn’t offer you a coupon, etc. Perhaps without knowing, she’s reminding you that you were just given something. I don’t know how many times I’ve ended up at a checkout counter buying some new natural juice that I’ll likely never drink, or liked very much.
Survey companies have also really taken this up a notch by sending surveys with a dollar. Just a dollar, and the response rate goes through the roof because recipients feel that they shouldn’t take the dollar without doing something- oh, how about sending back a survey, yes?

At our company, while we LOVE all of our customers, the most profitable are those that buy managed web hosting services from us. We like to find ways to let our current clients, and anyone else, see how talented our technicians are and how much there is to benefit from our managed services. It’s not something that we learned from a psychology book- it’s more of looking at simple karma in business. At times, our very talented technicians have a bit of downtime, so we have them seek out people needing assistance. One benefit that I’m sure we’re seeing, according to this book, is the internal programming that some of us have in wanting to reciprocate.

I found this interesting, and maybe you’ll find a way to apply the thinking to your business. Share some knowledge, or give something away. If the psychology stuff is all wrong then, if nothing else, you might be due for some good karma.

This is a touchy subject, which is why you won’t likely find many dedicated hosting company managers and owners openly addressing this topic, instead instructing their sales reps to find ways to jump around the subject. Our take is that it’s common sense, and therefore no reason to avoid the topic!

If you follow the industry at all, have servers elsewhere, read Web Hosting Talk, otherwise stay ‘in the know’, then you’ve likely seen some of our competitors increasing prices retroactively for all their clients. I won’t bother to mention names, but some of the price increases have been as high as $30 a month on a $100 per month server – 30% per month. Each and every price increase, from what I can tell, are direct results of rising energy costs. Just like almost every other business, hosting is very much affected by rising energy costs. That said, there are some things that clients should be aware of, and be protected from 30%~ increases:

First, some of the price increases that I’ve seen are excessive. I don’t doubt the legitimacy of the need to increase prices to cover costs and these businesses, I’m sure, are well aware of the negative PR that will arise (and has!). But, as a business owner, that is the absolute last thing that I would ever want to do. So, the price increases were likely legitimate, but poor planning and playing with fire, is what I say!

These companies are largely using commodity hardware — old and cheap hardware that isn’t at all power-efficient (but it’s cheap!) This leaves the companies severely exposed- rising electricity costs ($), infrastructure upgrades (more $) and, of course, depleting margins. Who picks up the tab? You guessed it.

Here’s what you will hopefully take away from this.

a) Avoid companies that offer a price-lock to every customer. While it sounds great on the surface, think about the economics at play here. Hosting companies, especially dedicated hosting firms, have to pay big electricity bills each month. I’m not an economist, but I know that energy prices are highly unpredictable (given today’s gas prices, who doesn’t?)

With that said, we have *never* raised our prices and we have absolutely no intention, or need to, raise them today, or the foreseeable future. If electricity prices quadruple next month, we would obviously have to address this, but we have some protection from that. A company offering a price-lock indefinitely is playing with fire, because you can’t always guarantee that electricity rates won’t continue to increase at the rate that they have. Have a look here- http://news.google.com/news?q=electricity%20rates%20increase%20this%20year&ie=UTF-8&oe=utf-8&rls=org.mozilla:en-US:official&client=firefox-a&um=1&sa=N&tab=wn

The headlines:
FPL seeks 16 percent rate increase
Are you up to speed… electric rate increases
PUC approves electricity hike
OG&E to ask for rate hike
Pay more for power? I&M electric pursues a 14-percent rate increase
City feels utility rates will rise

… you get the point… Just today, a lot of hosting providers costs just went up! I don’t care where you are- Colorado, Kentucky, California (who are you kidding), it doesn’t matter. Electricity rates are going up!)

b) Along with this, it’s just generally wise to avoid hosting on inefficient hardware. Here are the numbers - our servers use HALF of the power that many of our competitors’ servers use. This means a smaller electricity bill, less strain on our infrastructure (read: less chance of outages/possibility of large issues) and, subsequently, we’ll (you’ll) get more from our infrastructure.

Not to mention that warm fuzzy feeling you’ll have by being more environmentally friendly

Really though- if you have one server and your provider has been using garbage hardware and they increase your price on your server, it probably won’t be the end of the world. You’ll end up paying more and you’ll, of course, have the opportunity to move to a company better prepared. The people that are really in a bind are those with hundreds of servers that just had their margins squeezed dry. Don’t get caught in that situation- June is a great time to move to SingleHop because we’re not only locking in your price (only those that sign up in June) and providing a $200 credit if you transfer from a competitor, but we’ll also guarantee that you’ll be on a much more power-efficient server, with a company better prepared for wherever energy rates might go!

I previously owned midPhase shared hosting, founded it in 2003 and it was successfully acquired in 2007. We started the business with little capital, and we knew from day one that we wanted our core business to be shared hosting, so that’s all that we focused on. Aside from that, we didn’t have the capital or the resources to provide dedicated hosting when we knew that there was a great market for it. I’m sure a large portion of existing SingleHop clients that read this will have heard of midPhase, because such a large portion of our client base was previously a midPhase customer! Looking back though, I wish that we had the resources or the ability to offer servers sooner than we did, but we decided to simply not bother with it. Don’t make that same mistake, that if you can’t afford servers you simply won’t offer them. There can be a middle ground, and that’s reselling dedicated servers.

We’re working hard right now to have a reseller control panel out very soon, and shared hosting companies will clearly play a big role in it’s success. As we develop the reseller system we’ll have a unique perspective having owned and operated a large shared hosting company myself. We are already working with some shared hosting companies, names that we’ll soon announce, so if you are interested, fill out our partners form here- http://www.singlehop.com/partners/index.php

I was always keen to getting in to dedicated hosting, because shared hosting was so successful, and some portion of those clients will inevitably grow and need something larger. Offering dedicated servers can diversify your product line very easily- even if you only provide as an upgrade path for clients that need a server. Either you give them the option, or they’ll go to someone that will, so why not have it available? You’re losing revenue if you don’t.

As a growing business in a competitive industry, it’s important that our business runs as lean as possible without cutting the value of the service you provide. By that I mean if you’re a restaurant, you obviously don’t want to buy cheaper ingredients if it reduces the quality of your service, reduces your value proposition. In our business, the areas that we can’t reduce quality are obvious- support, the quality of our hardware, the networking gear we use and so forth. However, there are a number of areas that every business can reduce costs, and below I’ve aimed to highlight 10 common areas frequently overlooked.

1. Merchant Service Fees
I’ve been in the merchant services industry, and still am to some extent, and I’m the first to admit that pricing is key here. If you aren’t under contract with your current provider- and there’s a 99% chance you aren’t- try renegotiating with your current provider, and also send over your past three months of statements to other providers. This is a price game for the most part. Also, it’s estimated that over 10% of all credit transactions are from debit cards, and the banks take less risk on debit cards, so they’ve recently opened a cheaper category exclusively for debit cards referred to as the 4-tier pricing system. Ask your provider and others about that. A company that I have ownership in, www.ProcessingPoint.com offers it, so you can start there!

2. Long Distance Fees
Cutting your long distance bill doesn’t reduce value, so shop this around. If you’re stuck on keeping landlines, than talk to providers about bundling long distance and your landline services.

3. Advertising, mainly though your customer acquisition costs
It’s very important to track your acquisition costs. You can get free tracking by using Google Analytics, but make sure to take the time to build in the conversion tracking. While not all campaigns are going to produce direct results, you should still be able to track the effectiveness of campaigns, and if they aren’t performing talk to the publisher you’re advertising with to reduce your rate. You’ll find that they normally will, so just have an acquisition cost in mind, track it, and go back and re-negotiate if needed. It’s also important to of course make sure your conversion problem isn’t on your end, so also make use of bounce rates in Google Analytics, and work to constantly reduce that.

4. Froogle !!
I love Froogle. If I’m ordering something basic like a particular APC model, or something that I won’t need support for that essentially comes from the same manufacturer, shop it on Froogle! I’m not one to buy essential gear on eBay, but Froogle can be a great cost-cutting measure for new purchases.

5. Wireless Bills
If you aren’t stuck on your current provider (or don’t have an iPhone!), contact your local wireless shops, and see if they’ll compete for your business. If you have 10 or so lines it shouldn’t be a problem, and you’ll find that in one way or another they’ll even find a way to take care of your contract termination fee.

6. Land lines -> VoiP
Prior to switching to Asterisks, we were using a Nortel system with landlines. The Nortel system cost us $20,000~ or so, and was incredibly inflexible. When we needed to do anything to it we would have to pay a technician $150 an hour to sit in our office calling Nortel to find out how to do something. Save yourself the headache, get better service, and cheaper monthly recurring costs by paying someone to set up an asterisks box for you, and switch over to Voip. Nine times out of 10 it makes sense.

7. Outsource your hosting / Allow your provider to manage your infrastructure
This is where I get my plug, but honestly- there’s no need to have in-house staffing to manage your servers. There are plenty of companies, like SingleHop, who can provide it for a fraction of the cost, and who have the infrastructure in place to do it much better. Pick up a dedicated server from us, or if you aren’t quite ready for a dedicated server, check out midPhase for shared hosting, or any number of the thousands of shared hosting companies.

8. Outsource your Human Resources, but be careful
Outsourcing HR is a great move. Administaff, SOI are two companies offhand that provide outsourced HR. SOI, I believe is the cheaper of the two, but they both do a great job at consolidating your various employee benefits and combining them in to one bill. They also free up time by handling things like W2’s, paying employees, and so forth. Be careful though to have a full understanding of the fees that they charge, but this is one area that SingleHop saves money in by outsourcing, and that I’ve had previous businesses save money as well in.

9. Take checks over Credit
This goes in line with #1, Merchant Fees. When an existing client wants to pay with a check, we welcome it. This isn’t to say that you should post a sign saying you have a $25 minimum credit card fee, because that simply deters business (and by the way is against Visa regulations), but let your clients know that you’ll happily accept their check as payment.

10. Seek at least three bids on absolutely everything that you can!
This isn’t exactly one area to cut costs, but it should to nearly everything. We try to make a habit of putting together a quick description of what we’re looking for, and kicking it out to at least three vendors. You’ll be amazed at how quickly you start to save money on things that you wouldn’t expect. Shop it around, just like we expect you’ll do with your SingleHop quote!

Zak

I was viewing Digg this evening and came across this video:

http://video.google.com/videoplay?docid=-2398916025034509084

Needless to say, someone is crying right now! This leads me to my point- we want to price match, and we’re confident that we provide a ton of value, but all things aren’t created equal in web hosting and this video provides a great example of that, but I could think of examples all day long where providers cut corners to get their prices down. I’m all for affordability. I owned midPhase hosting, which provided, and continues to provide, an incredible value in shared hosting, and we’re doing the same with SingleHop, but we absolutely refuse to cut corners to provide ‘cheap dedicated servers’.

Here are areas that providers cut corners in, and you should be careful of, and bare with while I toot our own horn a bit!

The dedicated server business is a really expensive business to grow in. If you add up customer acquisition costs, sales commissions, and hardware, we can easily invest $2,000 in a single client. Needless to say, it’s incredibly important that we provide the best service to each client, because above all we’ve paid an enormous amount to get your business, and now we need to keep it!

As you’ll likely see on the site, we’re making a huge shift here at the company. There is a big problem with our planet’s environment, and until recently, SingleHop hasn’t even taken notice to the additional harm that we’re doing! We don’t claim to have the answer, and we don’t claim to be environmentally friendly, but after taking note of the thousands of tons of CO2 we’re producing, we’ve already began making changes, and we’re going to continue to do so!

How many times have you talked to a doctor and not known what the hell he was talking about? What about a lawyer, maybe a car mechanic, or even a computer technician? Well what’s interesting is that these are MASSIVE industries, and it’s rare to see an organization that can present their services on a level that the customer can understand. Managed dedicated servers are no exception. Companies that require managed services don’t want to manage that side of the business- they want us to present a clear and concise solution for their business, and that’s what we went for.

When dreaming up ideas for SingleHop, we were in a fortunate position to test services to midPhases’ dedicated client base, which was pretty substantial. To get started, we set out following suit of some of our competitors, and provided an all-inclusive management service. Initially, I thought that this was the most logical step- one that took the confusion out, and kept things pretty simple for the customer. You come to us, and we’ll manage everything. The drawback with this solution was that in order to do this on a mass scale, we would have to keep our prices pretty high, and things have changed since the late 90’s. Not all companies today require complete management, so that was no good. We had to find a solution that was not only transparent, in that the customer knew exactly what they were purchasing (read: not confusing), but a solution that would allow customers to select management services that they actually needed, and weren’t simply required to purchase to be a customer with us.

Our next step was attempting to develop tiered support packages, which seems to be what most of our competitors are offering. Package A provides this, B gives this, and so on, but we still felt that this wasn’t transparent, or flexible enough, to offer.

After some thought, we opted to go with allowing customers to completely build their management packages which, surprisingly, is a new concept for this industry. We had a growing list of management services to provide, that were bundled from our first attempt at providing an all inclusive service, and we split them up allowing customers to purchase only what their business required. If you already have someone on staff that’s familiar with cPanel, or updating kernels, you don’t need to pay twice for it- have them do it, and pay for what you could actually use, like our backups or monitoring services… or not.

We launched SingleHop in early November of 2006, so we’re not even four months old yet, but we’ve been growing by leaps and bounds, and there’s no slowing down insight. Today, in fact, we’re very excited to see this recognized by HostingReview.com, who announced that they have ranked us as a Top 3 Fastest Growing Hosting Company in an industry with thousands, and thousands of providers. In addition to the hard work that our employees continually put in, I think we can attribute much of our success to taking much of the confusion out of managed hosting, and meeting today’s needs of customers.

Zak